Consumerism in healthcare has been hailed by many including ourselves as one of the key components in solving the healthcare crisis in the U.S.

“…one of…”

Pushing cost to the patient is merely the first step. Without transparency, consumerism has the potentially devastating affects on the gains that wellness and disease management have begun to make.

Under Consumer Directed Health Plans (CDHP), the patient is responsible for more of the costs. They are often shocked to find that the cost of an office visit is $70, $80, $100 or more. They are distraught to discover that a diabetes maintenance drug runs them $750/month. So while CDHP help to make consumers accountable for the costs they incur, it provides a negative reinforcement as well.

Remembering that the last office visit cost them $80, patients may opt not to go for their annual physical. Aware that the medication was $750 last time, the patient halves the dosage or forgoes the prescription. Not knowing what the cost of a different service is going to be, but having been hit hard for other healthcare expenses, the patient simply avoids or delays care. None of these scenarios bodes well for wellness or disease management.

As a consumer, the patient needs to be educated on how the costs and how the healthcare system works. They need to understand that the annual physical may be covered under wellcare in their plan and comes at little or no cost. They need to know that the same $750 prescription can be had for $450 at a different pharmacy directly across the street. They need to know the cost of services when referred to a specialist before they go, lest they decide they cannot afford the risk of incurring a large expense.

Consumerism without cost transparency and education of the patient/consumer threatens to undo all of the positives that healthcare has been working so hard on in the form of wellness and disease management.

The answer lies in transparency in the system. Make healthcare transparent and the consumers will ferret out the inefficiencies in the system, make rational decisions about trade-offs in quality versus cost, and in the end, the patient/consumer will be the solution to improving the U.S. healthcare system.

Step 1 is Consumerism.

Step 2 is transparency about cost and understanding the health plan.

Step 3 is the consumer stepping in to make rational decisions about what defines quality and what warrants reasonable cost in the market.

We’ve come a long way from the days of the snake oil salesman doctors. We have metrics, proof, real information, process, procedure and healthcare is FAR better as a result.

But I’m reaching saturation point with the quality talk. The only available quality metrics are on the hospitals, but they are comprised of individual docs who make up the numbers. Those docs come and go. The fact that even USA Today points out, is that most are clustered around an “average.” And that means you get basically the same quality of healthcare service in the US wherever you go with few exceptions.

As for those exceptions, they are few and far between, so they’re not accessible for all of us. And if we all go them, their ability to provide that quality of service will suffer as they realize increased volume and stress on their systems.

And still, I can go to the best hospital in town, but it comes down to the doc. If I have a condition the doc has not seen before, the quality is arguably going to suffer. Or possibly worse, if they’ve hired on some quack, and I get stuck with them in the ER, my quality experience will suffer.

That means that failing reliable data on a specific doc if all healthcare clusters around “average,” then the only quantifiable differentiator is price. So what is reliable data? Malpractice information? Do I look at number of claims or size of awards or awards in aggregate? Or should it be malpractice claims for a certain condition versus number of times treating that condition?

Maybe outcomes data is more important. So do I look at number of deaths? Make sure it’s severity adjusted so you don’t knock the doc for seeing a higher number of really sick patients. And be sure you take into account if the doc has just picked up a new procedure that will improve those abysmal outcomes he/she has been having.

This is why Zagats has gotten into the ratings game – it’ subjective – entirely. The meal you get one night at a restaurant is not the same meal you get the next night. The chef may change. The steak may be fresher. There may be a larger crowd.

It’s the same with healthcare. Have a procedure done. You might have a better blood pressure and better conditioning than the other person. Certain procedures may be valid for you but not for someone else.

It’s subjective. Quality in healthcare is almost entirely subjective. The quantifiable metric is cost. That’s the primary reason we chose to pick up the Hospital Value Index in our application because they factor cost in where others do not. So since everyone is basically “average” without specific data on a doc, ask this simple question the next time you require healthcare, “How much should I pay for this snake oil?”

Once again I had the privilege this morning to hear Sen. Bill Frist speak, this time at a breakfast held at Lipscomb University.  Though last time the topic was highly focus, today the slate was clear and anything to do with health care was on the table.  Although our time was limited, Frist managed to cover a lot of important topics and share his vast amount of experience and knowledge with us in the crowd.

The conversation began with a reminder that the US, compared to other countries, ranks poorly when it come to life expectancy and infant mortality, despite spending twice as much as other comparable countries.  Why is that?  Well consider what makes up health and life expectancy: 40% Life style and Behavior, 30% Genetics, 15% Socioeconomic status, 10% Health Services and Technology, 5% Environment.  Unless you have been living under a rock, its no shock…  we live in a country where our life style choices are not the greatest, a large portion of our country is obese and many people do not regularly exercise.  Add poor lifestyle choices to our lack of desire to change our behaviors, its no wonder we rank so low.

Anyways, from there we managed to discuss cost shifting, Medicare and the pending 10.6% reimbursement cut,  and the uninsured among other things.

My most important take away was his belief in consumerism and the public sectors ability to affect change.  In most all markets, with very few exceptions, competition and consumerism drive down or at the very least maintain costs.

Transparency… the new industry buzz word… connects right into this and refers to the idea that information regarding cost, quality, outcomes, and experience should be readily available to all consumers of healthcare (cost and quality being the top two, considering they are what we are having the hardest time controlling).

By making the industry more transparent, especially how much a physician is really being reimbursed for their services and how much a procedure will cost them before having it done, consumers have a better idea of the true cost and quality of the care they receive.

Wonder what the result is?? Well it’s believed that transparency in the industry will make consumers more inclined to take responsibility and accountability for their own health and health care. Now here’s the reality,  not everyone is going to care about how much their health care cost – Just like not everyone is going to care about “global warming”.

However the industry just really needs to see an emergence of “the prudent shopper”… the group of people that begin talk, begin taking note, and begin to care about their health care and its cost.

If you think you might be the next “prudent shopper” of health care, visit www.changehealthcare.com and see what you think… tell us what you think! We are moving into the world of transparency and engaging consumers… be part of that change.  That’s my advice.

Transparency, accountability, and competition… I must say – I am always happy to keep my feet moving, rather than be left behind.